The gold rally continues to gain pace, as geopolitical and fiscal events drive safe haven buying. Gold has so far hit a peak of £1,647 per ounce, and the UK record of £1,659.59 is now well within reach of the metal and could be broken today at the current pace.

Gold briefly dipped as markets opened this week, hitting £1,601.26 Tuesday morning, but has now firmly bounced back to exceed even last week's high. In the US this represents a price of $1,990, and $2,000 will be the key psychological level to beat.

261023 Gold Price Chart

Gold has seen exceptional gains in the past month and is holding above £1,600.

A 'targeted raid' by Israel into Gaza has sparked the latest rally in the gold price, and there appears to be no peaceful resolution to the conflict in sight. With a further ground invasion of Gaza expected the war with Hamas remains a key driver for gold in the coming week.

Next week will also see the latest interest rate announcements from the Fed and BoE. A further pause from the Fed could signal the peak for US rates is in, which would likely see the dollar fall from its recent peak. The strength of the dollar has kept gold below the US all-time high, but gold has been testing (or beating) records in many other currencies.

Outside of the UK, gold has also broken all-time highs in many other countries, including the EU, Japan, China, and Australia. Given gold is achieving this in a high-interest rate and high yield environment suggest gold has significant further potential to grow when financial distress forces central banks to pivot. Just a few years ago, £1,700 per ounce seemed unlikely, but is now a conservative forecast for 2023 given recent events.